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Tom Johnson Manufacturing intends to increase capacity through the addition of new equipment. Two vendors have presented proposals. The fixed cost is $ 2 5

Tom Johnson Manufacturing intends to increase capacity through the
addition of new equipment. Two vendors have presented proposals.
The fixed cost is $25,000 for proposal A and $32,000 for proposal B.
The variable cost is $12 for A, and $10 for B. The revenue generated
by each unit is $20.
A. What is the BEP in units for proposal A?
B. What is the BEP in units for proposal B?
C. What is the BEP in dollars for proposal A?
D. What is the BEP in dollars for proposal B?
E. If the expected volume is 3000 units, which alternative should be chosen?
F. If the expected volume is 3500 units, which alternative should be taken?

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